11 Reasons Not To Enforce Your Trade Secret
I’m strangely fascinated by the recent “revelation” about Colonel Sanders’ secret recipe for Kentucky Fried Chicken. His nephew showed a journalist a handwritten list that was left behind by Sanders’ second wife that listed 11 herbs and spices in specific proportions. Yum Brands, which owns KFC, denies that this is the secret recipe.
This situation exposes a basic problem in trade secret law, which is that the available remedies are often pretty inadequate. Suppose this is the secret recipe. Suing Sanders’ nephew will not get you much in damages–he’s not wealthy. You can’t get an injunction–the information is out. Maybe the only thing you can do is pretend that this is not the real recipe and not bring an enforcement action at all. (Granted, you can say that the real value of KFC is in its brand rather than its secret recipe, so a revelation like this actually causes little or no harm, but I’m not sure Yum thinks so.)
More broadly, trade secret law suffers from the problem that the owner of the information really needs an ex ante remedy akin to a prior restraint. Once the secret information is out, there’s not much that can be done. Acting before that happens, though, is often impossible or requires keen anticipation skills. Perhaps this is why, as a practical matter, confidential information is protected more effectively through physical security measures, extra compensation, etc.